U.S. adds 165,000 jobs in April, unemployment rate drops to 7.5%

A better-than-expected jobs report pumped new life into Wall Street on Friday, driving the Dow Jones industrials and S&P 500 to record highs.

The Labor Department reported that U.S. employers added 165,000 jobs in April - considerably more than the 140,000 economists had expected. Job growth pushed the nation's unemployment rate down to a four-year low of 7.5 percent. That was down from 7.6 the previous month and 8.1 percent a year earlier.

Employment gains for February and March were also revised upward. February jumped from 268,000 jobs added to 332,000, and March rose from 88,000 new jobs to 138,000. That made for a total added gain of 114,000 jobs.

"The job gains in April tell us that the labor market continues to improve at a steady pace," said Robert Kleinhenz, chief economist for the Los Angeles County Economic Development Corp. "The upward revision to the weak job gain figure from March is especially welcome. The job gains thus far this year are consistent with moderate growth in the overall economy. It will be encouraging if gains such as these continue over the next few months when the negative effects of sequestration budget cuts will be felt."

Coming after a weak jobs report for March, the new figures helped ease fears that U.S. hiring might be slumping this spring for a fourth straight year.

Friday's news propelled the Dow above 15,000 for the first ever, although the blue chip index ended the day at 14,973.96. The broader S&P 500 index closed at record 1,614.42.

Still, there are some grim realities on the back end of Friday's numbers.

While the headline unemployment rate was 7.5 percent, the broader reading is actually 13.9 percent when those who have given up looking for work and others who are underemployed are factored in. That rate fell from 14.5 percent a year earlier. But an estimated 11.7 million Americans are still unemployed. And 4.4 million Americans are still considered to be long-term unemployed, meaning they have been out of work for 27 weeks or more.

April's biggest employment gains came in professional and business services, which added 73,000 jobs that month and 587,000 jobs over the past year. That industry includes everything from accounting and tax preparation to computer systems design and legal services.

The leisure and hospitality sector also boosted its payrolls. Employment in food services and drinking places rose by 38,000 over the month and grew by an average of 25,000 jobs per month over the previous 12 months.

Retail added 29,000 jobs in April and health care added 19,000 jobs. Employment in construction fell slightly, but the nation's construction industry gained an average of 27,000 jobs per month over the prior six months.

New data from the Associated General Contractors of America show that the unemployment rate for construction workers hit its lowest April level in five years last month as contractors added more than 150,000 employees over the past year. The unemployment rate for jobseekers who last worked in construction fell to 13.2 percent in April compared with 14.5 percent a year earlier.

"It is heartening to see that both nonresidential and residential segments of the construction industry added significant numbers of workers in the last 12 months, even though gains from March to April were limited to the residential side," Simonson said in a statement. "Other indicators, such as the continuing growth in architectural and engineering employment, suggest that demand for construction will expand further."

Manufacturing remained flat in April and employment in other major industries - including mining and logging, wholesale trade, transportation and warehousing and financial activities - was little changed.

Bob Machuca, a regional manager with the LAEDC and the San Gabriel Valley Economic Partnership, said he's seeing mixed results in Southern California's manufacturing sector.

"I do see some positive things happening, but very slowly," he said. "We're starting to see more purchasing of machinery but it's more advanced kinds of equipment that won't create a lot of jobs."

Machuca noted, however, that L.A. County still employs 390,000 in manufacturing. And the days of heavy job losses, he said, have slowed.

"It hasn't been growing, but we're not losing as many jobs as we have the last three years," Machuca said. "One company I know is cutting hours. They don't want to lay people off, so they're doing furlough Fridays. But we have a program to help them. We're working with the employees to get unemployment benefits. That will pay them for the eight hours so they won't be on furlough."

Southern California's unemployment rates have remained much higher than the nation's.

In March, L.A. County's jobless rate was 10.2 percent, down from 10.3 percent the previous month and 11.2 percent a year earlier, the state Employment Development Department reported. The county added 82,600 jobs year-over-year.

The Inland Empire's unemployment rate for March was 10.5 percent compared with 10.9 percent in February and 12.4 percent in March of 2012. The two-county region added 23,500 jobs over the year.